Calculate the price elasticity of demand. a) When the price of a phone call increases from...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Calculate the price elasticity of demand. a) When the price of a phone call increases from $8 to $12, the volume of calls falls from 25,000 per hour to 15,000. b) New car dealers currently sell approximately 1,650 vehicles annually at an average price of $4 million. They have told the government that if the proposed higher import duty raises the price of new cars by $% million, they expect their sales to fall by about 300 per year. Calculate the price elasticity of demand. a) When the price of a phone call increases from $8 to $12, the volume of calls falls from 25,000 per hour to 15,000. b) New car dealers currently sell approximately 1,650 vehicles annually at an average price of $4 million. They have told the government that if the proposed higher import duty raises the price of new cars by $% million, they expect their sales to fall by about 300 per year.
Expert Answer:
Answer rating: 100% (QA)
CASE A Price elasticity of demand CHANGE IN QUANTITY DEMAND CHANGE IN PRICE Price increased 8 ... View the full answer
Related Book For
Posted Date:
Students also viewed these economics questions
-
Calculate the price elasticity of demand for gasoline in California. As Gas Costs Soar, Buyers Flock to Small Cars Faced with high gas prices, Americans are substituting smaller cars for SUVs. In...
-
The price elasticity of demand for oatmeal is constant and equal to 1. When the price of oatmeal is $10 per unit, the total amount demanded is 6,000 units. (a) Write an equation for the demand...
-
Exercise 14-3 (Algo) Determine the price of bonds; issuance; effective interest [LO14-2] The Bradford Company issued 12% bonds, dated January 1, with a face amount of $90 million on January 1, 2021....
-
The probability that fewer than 35 people support theprivatization of Social Security A discrete random variable is given. Assume the probability of the random variable will be approximated using the...
-
Sun Devil Corporation reported EBITDA of $7,300,125 and net income of $3,328,950 for the fiscal year ended December 31, 2014. During the same period, the company had $1,155,378 in interest expense,...
-
What special rights are normally carried by preferred shares?
-
Which do you think has less variation: the IQ scores of students in your statistics class or the IQ scores of a simple random sample taken from the general population? Why?
-
In 1913, how long did the average worker stay with the plant? What was the average tenure of a worker? Assume the one-millionth vehicle was produced in 1916 at a cost of $8084 (in 2013 US$). By how...
-
Edward s Bowling has total assets of $ 1 2 9 0 0 0 and total liabilities of $ 3 9 5 0 0 . At the beginning of the year, the owner s equity was $ 7 1 0 0 0 . During the year, Edward, the owner,...
-
1. Are Kellermans calculations correct? These are the first items to verify. 2. Take a close look at the data using appropriate statistical methods. 3. Are Kellermans conclusions correct? If so, why...
-
How many times will the message "Hello!n" be displayed?
-
Record the following transactions for the year 20x1, using T-accounts (open any accounts you may need). The Burnside Company uses the periodic inventory procedure. a. Sales of $150,000 were made, of...
-
The following abridged Balance Sheet of S Co Ltd. as on 31.3.2016 is given below: The following scheme of reconstruction has been sanctioned by the court: (1) A new company S S Co Ltd. is formed with...
-
Assuming an x86-based 4-level page table in both guest and nested page table, how many memory references are needed to service a TLB miss for native vs. nested page table? To support multiple virtual...
-
The mean residence time in a tubular reactor is the length L divided by the average velocity v = q/ R 2 . Using the results from Problems 7.8 and 7.9, what can you say about the relative values of...
-
Sketch curves for throughput, delay, and power, each as a function of load, for the following networks. Throughput is to be measured as a percentage of the maximum. Load is to be measured (somewhat...
-
How do financial planning and strategic planning influence healthcare organizations? Provide an example.
-
The relationship described in question 7 does not always appear to hold. What factors, besides the number of firms in the market, might affect margins?
-
Why is vaccination against many childhood illnesses a legal requirement for entry into public schools?
-
Suppose the demand curves for hour-long episodes of the Jerry Springer Show and Masterpiece Theatre are as shown in the following diagram. A television network is considering whether to add one or...
-
A British-made automobile is priced at 20,000 (20,000 British pounds). A comparable U.S.-made car costs $26,000. One pound trades for $1.50 in the foreign exchange market. Find the real exchange rate...
-
Describe the differences and similarities between spectators and participants of sport.
-
Discuss the spectators eight basic motives for attending sporting events. Which of these are similar to the motives for participating in sports?
-
What are the value dimensions of professional sport to the community? How would sports marketers use these values in planning the strategic sports marketing process?
Study smarter with the SolutionInn App